Bipartisan Bill Would Extend Small Biodiesel Producer Credit

A new bipartisan Senate bill wants to make sure small-town biofuel plants—and the local farmers who keep them running—have the steady ground they need to plan ahead.

Sens. Chuck Grassley of Iowa and Amy Klobuchar of Minnesota introduced the Small Agri-Biodiesel Producer Credit Extension Act, which pushes a critical tax incentive out through 2029 instead of letting it expire at the end of 2026. For local plants producing under 60 million gallons, it keeps a 20-cent-per-gallon tax credit alive for their first 15 million gallons.

What does that actually mean? It gives rural communities the financial certainty to invest, protect jobs, and keep demand strong for home-grown crops. Backed by groups like Clean Fuels Alliance America and Western Iowa Energy, the bill protects a vital engine of the rural economy—which in Iowa alone supports over 31,000 jobs.